KAM response on the planned duty-free importation of finished edible oils

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By Rogers Aghan, February, 20, 2023, Kenya Association of Manufacturers (KAM) recognizes efforts by the government to cut down on the cost of living.

“Most Kenyans are currently facing hardship during this time. It has been challenging to earn a decent living with the high cost of medical care and housing eating away at citizens’ income.” said Rajan, Chairman of KAM.

According to the organization’s top management, the latter will continue working with the government to alleviate the high cost of living among its citizens through undertaking crucial actions and policies which could address the root cause of high living costs and reduce the financial burden on individuals.

KAM is concerned by the plan to import duty-free products including 125,000MT of finished and refined edible fats/oils through the Kenya National Trading Corporation (KNTC) for a one-year period. Thus, It will seemingly create a price stabilizer for critical household commodities and eliminate drought in the Country.

The Business Membership Organization with nearly 1200 active members in the manufacturing sector reached out to the Ministry of Trade, investment, and industry (MITI) on 23rd January 2023, seeking an understanding of the duty-free importation of finished and refined manufactured goods.

KAM continues to seek engagement with the ministry to realize a viable solution.

The organization calls on the government to restructure its plan and engage members to establish a long-lasting amicable solution to avoid unfair competition to local industries and the possibility of losing Sh.3.5 billion in revenue.

Nearly 40,000 jobs could also be on the line.

The organization is aware of the misinformation in the public domain regarding 13 manufacturers of edible fats/oils in Kenya alleged to be importing finished products, repackaging and pushing them to retailers locally.

According to the chairman of the Kenya Manufacturers Association, Rajan Shah, the information is far-fetched and nonfactual.

Kenya’s edible oil processing industry is vibrant with nearly Sh.100 billion in investments.

The organization has urged the National Treasury to waive the 2% nut and oil levy, remove IDF and RDL, review port charges, and reduce the cost of electricity.

The move will not only make the sector more competitive but also lower the cost of finished edible oils.

Locally, the sector is taxed 2% nut and oil crop (NOCD) levy by Agriculture and Food Authority; I.5% IDF and RDL, respectively; 16% VAT; 10% excise on locally produced packaging materials (Finance Act 2022); depreciation of KES against USD (by 19.5%); and Port charges.

Tags: #Africa, #Electricity tariffs, #KAM, #Kenya, #manufacturing

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